Braskem, Siluria to develop methane-to-ethylene process technology

Braskem will help Siluria Technologies to market a process for making ethylene from methane, the largest component of natural gas. The $15 million factory should open in the fourth quarter of 2014.

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By JACK KASKEY

CAMACARI (Bloomberg) -- Braskem agreed to
help Siluria Technologies bring to market a novel process for
making ethylene from methane, the largest component of
natural gas.

Siluria is building a demonstration plant at Braskems
site in La Porte, Texas, to show how oxidative coupling of
methane, or OCM, can produce ethylene, the most used petrochemical and a key ingredient
in plastics, the companies said in a statement. The $15
million factory should open in the fourth quarter, Siluria
CEO Ed Dineen said.

This technology is on the leading edge
of developments in our industry and is well designed to meet
our needs for plentiful, affordable feedstock, Fernando Musa,
CEO of Braskems United States unit, said in the
statement.

Silurias OCM process costs $1 billion a year less than
average costs at naphtha crackers that produce ethylene and
$250 million cheaper than ethane cracking, based on feedstock costs since 2010, Dineen
said in a phone interview. At the heart of the OCM technology are proprietary
catalysts that turn methane and oxygen directly into ethylene
and water without the high heat used in crackers.

The use of natural gas as a direct feedstock has been a goal of the
chemical-fuel industry for a long time, Dineen said.

The technology works in existing ethylene plants and also can
be added to gas processing plants, which separate methane
from natural gas liquids, to turn unprocessed gas into
gasoline, Dineen said. The technology would help gas
processors and pipeline companies produce a higher value
product, particularly when ethane or methane prices are low,
he said.

Dineen, who previously was COO at LyondellBasell Industries,
said Siluria will announce additional non-exclusive partners
in the first half of this year. By 2017, Siluria should have
commercial units operating through licensing agreements or
partnerships, setting the stage for an initial public
offering, Dineen said.

Siluria in March said it had raised $66 million from
investors including Alloy Ventures, ARCH Venture Partners,
The Wellcome Trust, Bright Capital, Kleiner Perkins Caufield
& Byers, Altitude Life Science Ventures, Lux Capital and
Vulcan Capital.

Honeywell International and Dow Chemical are also developing
catalytic conversion processes for natural gas.

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